One of Jim Cramer's favorite investment themes is the turnaround of the U.S. housing market, which he currently recommends investors play through shares of mortgage insurer Radian Group, but only on a speculative basis.

"The mortgage insurance business was in trouble for years for the very same reason that it's coming back with a vengeance right now: housing," the "Mad Money" host said Friday. "When the housing market was in free fall, when no one was buying new homes and foreclosures were everywhere, the mortgage insurance stocks got killed. This entire industry was left for dead. … Now that the housing market is coming back, the mortgage insurers that survived, like Radian, are coming right back with it."

Around 10 months ago, there were questions about Radian's solvency, Cramer said. At the time, its stock traded at around $2 a share. The stock has since rallied around 291 percent, though, and currently trades at roughly $7 a share.

A few years ago, Radian had been the No. 3 player by market share in the private mortgage insurance market. Today, however, it boasts the biggest market share as the No. 1 player in the game. In 2012, the company wrote roughly $37 billion in new insurance, up some 139 percent from the year prior. In fact, it wrote $4 billion in new insurance last month alone.

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"It might sound crazy to recommend a mortgage insurer, but when you look at the fundamentals, it actually makes a lot of sense," Cramer said. "And you know Radian's business is only going to improve as the housing market continues to pick up steam."

The bears are still prowling around Radian, though, Cramer cautioned. Roughly 29 percent of the float has been sold short, meaning many investors are betting the stock will push lower. Cramer thinks the bears are wrong, though, because management said the company will return to profitability in 2013.

"This is the inflection point and it's why I'm willing to endorse the stock here, even after its enormous move," Cramer said. "Sure, Radian is now almost an $8 stock, but it has a book value of $14 when you include the value of the company's deferred tax assets. To me that sounds like a steal."